With the MiFID legislation altering the traditional exchange landscape in Europe and lifting the barriers to off-exchange competition, on Monday NYFIX said it had launched Euro-Millennium, a dark pool for Pan-European cash equities.
The new alternative trading venue went live in early March as its buy and sell side participants that are members of its advisory board began using the system. Credit Suisse was the first client to match live trades using its Advanced Execution Services (AES) algorithms to communicate with the dark liquidity venue. Euro-Millennium is currently matching U.K. equities and will be rolling out the other major European markets throughout 2008.
While NYFIX works on rolling out matching in the other European stocks, clients can also send pass-through orders into Euro-Millennium via direct market access pipes. Just as Millennium in the U.S. has the ability to hold residential orders, but pass orders through Millennium on its way to other market centers such as DOT and Nasdaq, "Euro-Millennium has the same rich deep functionality set," says Chris Smith, director, NYFIX International and head of Euro-Millennium. "Clients can send an order into a French stock today. "They could pass that to a DMA pipe to the market or we could send that to a preferred broker," explains Smith. This is possible because NYFIX International is a broker dealer regulated by the Financial Services Authority. "This allows us to send client orders not matched in Euro-Millennium to the relevant market," explains Smith.
In addition, NYFIX struck a deal with SWX Europe (formerly known as Virt-x) last year to act as the dark pool for Swiss blue chip securities and that is slated to be launched later in the year. The dark pool will be operated by SWX but powered by NYFIX Euro-Millennium. "It's largely transparent to the client," explains Smith, adding that clients would use "the same technology and the same connectivity to access the SWX dark pool while nuances and the different regulatory regimes are in the background."
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio